Ancillary Services in EMIX

[ed@cazalet.com]

Ancillary Services:

In yesterday's EMIX workshop we discussed at length how to characterize as a product type what is typically called ancillary services .  Ancillary services require interval metering.  For the regulation product, 4 to 6 second interval metering and direct control of the generator is required by the balancing system operator.  However, there are current initiatives by FERC and many ISOs to allow loads and storage to provide ancillary services.  One of the potential applications of the metering and communications infrastructure of the smart grid is to facilitate the participation of loads and distributed energy resources such as storage in providing balancing / ancillary services to the grid.

Three approaches were discussed.

1. Ancillary services products as defined by NERC for each reliability area can be defined as product types in EMIX.  Where there are ISOs a market in these project.  Such products are typically up and down regulation, spinning reserve and non-spinning reserve. The names can vary by market as can the characteristics of generators, storage and controllable loads that can qualify for each service.

2. Provide a product type in EMIX with several optional elements that allows loads, storage and generator to offer to offer various response times, ramp rates, cycle times ( how long the must be called for and how often they can be called, etc.)

3. Use the EMIX energy product type on smaller time intervals to provide ancillary services.  Consider the use case where communicating interval meters are almost ubiquitous and where sufficient automated price responsive devices such as air conditioners, pumps, refrigeration, electric space heating, electric water heating, and some industrial processes are installed..  Then energy only prices and transactions can be carried out on finer intervals as delivery approaches.  Hourly intervals can be broken into 12-5 min intervals, then 5-1 minute intervals and then 10-6 sec intervals, for example.  

Customers without automated response (or because they just don't want to) can choose to ignore high frequency price signals.  If the system operator or another party needs fast response energy it can offer to purchase energy on these intervals at any time ahead of delivery.  For example an operator changing its forecast of wind production to forecast a drop in production for 30 min from now , could offer to buy energy for a 60 min period starting 30 minutes from now.  Or if the forecast change was sudden, the operator might offer to buy energy starting 1 minute from now at a much higher price, and lower prices after about 10 min expecting fossil generators to respond in that time frame.  Additionally, the operator could offer to purchase call options at given strike prices , so that the operator could have assured control over at least some supply whether from generation, storage, or load.  

EMIX can support all three approaches.  
The first, standard ancillary services approach is in place today and will be for a long time in many jurisdictions so we must support it.  It is just a matter of providing a naming system for product types that is useful in multiple jurisdictions with different product definitions.  However, responsive devices and systems will have to be able to recognize the difference in product types in many juristictions.
The second case where loads, storage and generators make offer describing how much, how fast and how often they can respond to control signals and what price could be accommodated in EMIX with additional optional elements.  However if the market for these offers are the standard ancillary services products, then a offer could only qualify if it met all of the requirements of the ancillary service product as defined by NERC, for example.  And its capability would presumably have to be verified by the operator, just as generators do today.

The third energy only approach requires no modifications to EMIX.  Loads, storage, and distributed generation can respond to forward offers for energy supply in the amounts and with the lead time and frequency that they are capable of if the transaction is beneficial to them at the price offered.  No detailed information on a responders capability, current status, speed of response etc is needed.  If they deliver the meter will record their response.  If they don't the meter will record their non response and they will be charged an ex-post price by the operator for non-response based on the price the operator paid for an alternative response on very short notice.